BC Court Rejects Fraudulent Conveyance Claim

A British Columbia court has struck a fraudulent conveyance claim filed by Chinese investment companies against a Vancouver-area family, finding the plaintiffs relied on speculation rather than specific facts. Justice Branch of the Supreme Court of British Columbia dismissed the six-year-old claim and cancelled two certificates of pending litigation against West Vancouver properties.

The Investment Dispute

In December 2015, three Chinese investment companies agreed to purchase shares in a company controlled by a BC businessman. Under a supplementary agreement that included a buy-back guarantee, the investors paid 33.6 million RMB to the company. After a 2018 environmental investigation in China led to arrests and frozen assets, the company failed to return the funds.

The investors won judgments against the businessman in Chinese courts in March 2019. They then filed a claim in BC in November 2019 to enforce those judgments and pursue two co-defendants—the businessman’s son and the son’s mother—over alleged fraudulent conveyances. The same day they filed, the investors registered certificates of pending litigation against two West Vancouver properties owned by the son and his mother, arguing misappropriated funds had gone toward acquiring or maintaining the homes.

The Court’s Ruling

Justice Branch cancelled the certificates and threw out the fraudulent conveyance claim entirely. The court found the pleadings lacked the specific factual link required to support a claim to an interest in land under the Land Title Act. The investors had not specified when the properties were acquired or how the funds allegedly reached them.

The ruling noted that the investors’ own representative admitted at examination for discovery that he had no knowledge, facts, or information supporting the fraudulent conveyance allegations. Justice Branch found the claim “bound to fail,” saying it rested on nothing more than the assumption that funds must have moved to Canada simply because the company had no remaining assets in China.

For wealth advisors managing clients with cross-border assets, the decision reinforces that certificates of pending litigation cannot serve as a low-cost tool to freeze property while a case develops. Courts require a properly particularized factual basis connecting alleged misconduct to specific real estate. Speculation about where money may have gone will not satisfy that standard.

What Survives

The court declined to bar the investors from filing further certificates of pending litigation, finding their litigation conduct confused and disorganized but not serious enough to justify that step.

Other parts of the case survive, including the investors’ bid to enforce the Chinese judgments against the businessman and to hold the son’s mother jointly liable. A trial on those remaining issues is scheduled for two weeks starting July 12, 2027.